In general, an employer must give “independent consideration” to a current employee in exchange for the employee signing the noncompete for the noncompete to be enforceable. For example, an employer can require employees to sign the noncompete to keep their employment and give $500 to each employee as the “independent consideration” for signing it.

Here is something to consider for the employee who is leaving. Employees owe fiduciary duties to employers during their employment. This means that employees owe a duty of loyalty to the employer and cannot use company accounts, client lists, or company information for their own personal benefit. There are also trade secret considerations if the employee is taking confidential company information. Finally, you should consider whether the employee is tortiously interfering with your contracts with your clients. We handle this type of matter all the time. You are welcome to contact me to discuss ways to keep the business you may be losing or otherwise be compensated for this loss.

Aaron Hall
http://MinnesotaAttorney.com
ahall@twincitiesfirm.com

There are a number of legal issues relevant to your situation including (1) whether the noncompete is enforceable and (2) whether the intellectual property you created belongs to your employer. Each of these issues requires a close analysis of a number of facts and circumstances particular to your situation. For this reason, you should consult with an attorney regarding your situation. I cannot adequately explain all the applicable legal doctrines here.

Aaron

Here is the law regarding your two questions.

1. Electing a State’s Law

In a contract, parties can elect which state governs their contract as long as that state has some reasonable connection to the contract. This is called a “choice of law” provision and is fairly common.

2. Non-Solicitation of All Customers

Courts have upheld many non-solicitation agreements that prevented the former employee from soliciting any customer, including customers who had no contact with the former employee. However, the general rule is that the company must be protecting a reasonable company interest balanced against the employee’s right to find work. For example, if a clerk at Target signed an agreement not to work for any company who solicited customers of Target, and then the person left Target to get a job as a minimum wage clerk job at Wal-mart, I’m fairly confident that a court find that Target had no reasonable interested in preventing a clerk from working at Wal-mart. However, the Target example would be different for employees with more responsibility. This is an example of where the facts and circumstances of a situation are very important, so an attorney could analyze the details of your situation to advise you regarding your legal rights and options.

Aaron

Furthermore, it states that one can not solicit to any customer of the corporation, regardless of territory. It is my understanding that I cannot solicit to my current customers with whom I have relationships. Can the agreement prevent me from a accepting a position with a competitor in a territory different than my current territory with customers with whom I am unfamiliar?

A former employee may either request to review his or her personnel file once a year or obtain a copy of his or her personnel file free of charge once a year for as long as the record is maintained. (See Minnesota Statutes 181.961.) The noncompete agreement should be in your personnel file.

Aaron

Is your previous employer legally obligated to provide you with all SIGNED non-compete agreements they have on file? I have a unique circumstance where I provided a standard two week notice, was open and honest that I was going to a competitor for a better job offer and for the better part of a week they were very supportive. Abruptly, with 3 days left of my final two weeks they terminated my employment and said they would pay me for my remaining time.

They have sent a letter to my new employer but I do not know the details of that letter. My new employer has asked that I attempt to get a copy of my signed non-compete agreement which I have already done. I contacted via phone and email without response, what rights do I have?

My new employer has told me that they have my back and they are a very large corporation so I am less worried than if I was trying to defend myself but I do want to have their legal team look at the exact terms of the non-compete. Is it a situation where my new employer’s lawyers would have to attempt to get that information if they did not provide it to me directly?

Chris

“Contract-to-hire” can mean a lot of things. In fact, contracts can be named anything; what matters is the provisions in them. So without an analysis of the terms of the contracts, there is no way to know whether these contracts help or hurt you.

Aaron